2018: NUCLEAR SAUDI?

Chinese CNNC and the Saudi Geological Survey to cooperate on uranium exploration.

A booth of China National Nuclear Corporation (CNNC) is pictured at an exhibition in Beijing, China July 18, 2015. Picture taken July 18, 2015. REUTERS/Stringer

Saudi Arabia's population has soared well past 30 million, and energy demand shows no signs of abating, with growth rates of 8-10% annually. Naturally, demand for energy is expected to rise in parallel, expected to reach 70GW by 2020 and 120GW by 2032.

But while the population grows and energy demand skyrockets, oil and gas production has been declining, a trend which is expected to continue over coming decades.

Saudi Arabia launched its nuclear program in 2010, but it wasn't until 2017 that the Kingdom announced plans to construct 17 nuclear power reactors over the next 20-25 years.

These plants will require investment of more than USD80 billion.

But together the plants would produce up to 17GW of nuclear capacity by 2032 and supply 15% of the country's electricity needs.

By the end of 2017, concrete steps were being taken to achieve these targets. The first step is to ensure that the nuclear program is not reliant on feedstock imports, according to Hashim bin Abdullah Yamani, head of the King Abdullah City for Atomic and Renewable Energy (KACARE)— the Saudi government agency tasked with setting up a nuclear industry. The agency has stipulated its intention to extract uranium domestically, and preliminary studies show that Saudi Arabia boasts an estimated 60,000 tons of uranium ore.

Contracts are set be awarded for the first two plants by December 2018, around the same time that the necessary legislation for the program is passed and all of the regulations for a nuclear authority are finalized.

As of year-end 2017, Saudi Arabia had signed agreements with China, Russia, and France for technology to be used for the national nuclear project.

Negotiations are also underway with potential partners in the US. The Kingdom has also received requests from five bidders to perform the engineering, procurement, and construction work on two nuclear reactors.

Companies that have shown interest in working with Saudi Arabia include Électricité de France (EDF), which entered talks in October 2017, Westinghouse from the US, and China's CGN. Korea Hydro & Nuclear Power Co (KHNP) reported that several South Korean firms are bidding as a group for the upcoming two nuclear plant projects. Some project development agreements with two to three of the bidders are expected to be settled in mid-2018, but only one company will go on to build the two reactors.

Under financing from both the Saudi Arabian government and the winning vendor, construction for the plants would begin in 2019, with the expectation that they would go into operation as early as 2027. After commissioning, each plant will produce a maximum of 3.3GW, combined into a single power station of around 6GW.

Once Saudi Arabia's first reactors go online, it will become the second country in the Gulf to take advantage of nuclear power.

Regardless, the Kingdom has been following an agreement on safeguards with the International Atomic Energy Agency (IAEA) since 2009, and continues to state that its sole interest is in the peaceful use of nuclear technology for energy generation and economic efficiency.